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Published on Friday, March 7, 2014

Proposal establishes process for setting pension contributions for unpaid obligations

HB 2018 would require that the Pension Funding Council (PFC) adopt employer-specific additional contribution rates in situations where contributions are made other than immediately after service is rendered and when the amount contributed is insufficient and would result in rate increases to other employers and employees in the system. This is related to the Dolan v. King County case that found King County was in fact “in control” of a group of contract employees, and those employees should have been covered by the state PERS retirement system. King County is now ordered to pay the employer contribution share for those employees.

This bill could have implications in the future where an employer has not contributed or has contributed for employee pensions. The employer could end up paying a significantly higher pension rate; however, this could protect other employers from having a rate increase that results from the lack of appropriate payments by a specific employer.

HB 2018 passed the House unanimously and is currently in the Senate waiting for a floor vote.

Categories: Personnel